Topical items and views on the impact of digitisation on publishing and its content and the issues that make the news. This blog follows the report 'Brave New World',
(http://www.ewidgetsonline.com/vcil/bravenewworld.html ), published by the Booksellers Association of the UK and Ireland and authored by Martyn Daniels. The views and comments expressed are those of the author.

Tuesday, January 31, 2012

The ISBN, ISSN, BIC and BISC codes and jacket images have all helped the trade, but do they still matter as much in the digital and direct marketing era?

It’s as if we have all been on a constant never ending journey to improve the contextual information and identification of works. Everyone in publishing today understands the relevance and power of good structured bibliographic information. This helps us search, find, validate and select the right work, but is this still enough in today’s consumer driven market?

Today we use the likes of Google to search, Wikipedia to search deeper, Amazon and ABE to search for books and the likes of email, Facebook and Twitter to communicate. The reality is that they are what many of us use and so are pivotal to any marketing strategy. Does the consumer know or even care about the ISBN and would they know the BIC and BISC category codes?

Today we have to start to think about the user, how they want to find things, how they socialise and how they can validate the relevance of what they find.

The emergence of the jacket image, which really started with the likes of Amazon in the 90s, has now become a de facto standard. Whether we like it or not, users can and will often immediately, ‘judge a book by its cover’. It’s hard to imagine selling physical let alone digital trade books over the internet today without the jacket, but is that enough?

We all dabbled with ‘search inside’, but even Amazon often got this wrong and their ‘surprise me’ page could often turn out to be a ‘reject me’ one. First chapters were not fully exploited as a free teaser and the page selection experience was and remains somewhat inconsistent and haphazard across the market. It is interesting that academic publishers often understood the key pages to sell their books, but others left it to the arbitrary, ‘pick 10% from anywhere’, which could include front matter and even blank pages!

A product description, (blurb) and readers comments and their ratings often now accompany an individual title, but again more as filler than a driver and are often restricted to one site. Some would also suggest that some consumer comments, read like they had been written by a marketing person, an author and not a consumer.

We have seen the author video which often was too long and also tended to play to the converted. We have seen the emergence of other video reviews from retailers and fans but these often languish on YouTube looking for a home. Youtube is as valid a promotion platform as any, but how many use it and what information is tagged?

Google gave us the ultimate search across the content itself but this often was only as good as the term used and the pages rendered. How many jacket images and illustrations are correctly tagged, promoted and linked through the likes of Google images?

So as we move into the ‘enhanced ebook’ world and the content itself can explode into different media, how do we package that contextual wrap such that it is contestant across the market, engages consumers and sells books, be they physical or digital? Esther Dyson once said that the key to the Internet was being able to find that digital needle in the digital haystack. We would suggest that we haven’t found it yet. We may also have to rethink what we do and consider a revolution not a gentle evolution.

Some would suggest we adopt the DOI identifier but they would be as foolish as when it was first muted in the late 90s. Some would suggest that every form of a rendition is given a unique ISBN and that would appear to miss the mark. Some would suggest it more important that we are able to group renditions and present choice than divide them and offer a disjointed picture.

Finally, we are moving from a front list bestseller mass market to one that sells all books, in all forms and has a distinctively long tail. How do we revisit those long forgotten titles and ensure that they too have visibility?

It is important that we recognise that context needs to be uniform and available to all across the market. So what would you see as the contextual information of tomorrow?

Wednesday, January 25, 2012

Although they varied with the market sectors they served, being able to defining a book publisher used to be fairly easy. The same could be said of film, broadcasting, music, games publishers. However digital has the capability to change these well defined and understood divisions and not only explode the physical media container and constraints, but also the content itself and the roles of those who produce it.

Last week’s over hyped Apple event did one crucial thing – it brought home the reality that an ebook is just a mere digital container that can accommodate many different forms of digital content. Yes, we all knew this, but now everyone, everywhere can clearly see it. This not only has the potential to change what we see as an ebook but also creates a new awareness and potential market demand for something different.

The ‘digital container’ changes roles. Will the author be able to mix and mix digital content into a digital package or will they need help in identifying, validating and clearing rights to extra material. Will the role of the publisher as a collator, packager and administrator become more important in some sectors? Will others outside of the traditional book market step in to be publishers?

We now read that NBC News plans to launch NBC Publishing, aimed at publishing 30 interactive new e-book titles in the first year. The ebooks will be based on current events, documentaries, trends, biographies, and profiles and they are looking to leverage their existing content assets from shows such as NBC Nightly News, Today, Dateline, Peacock Productions, their archives, NBC Sports, and Universal Pictures.

The venture will enable NBC to use video, audio, and current programming in creative new ways and may prove pivotal as TVs become smarter and connected. They have brought in two publishing executives to help on the venture and plan to use a network of freelance professionals as needed. NBC claims over one million hours of archival video content going back to the ’20s can repurpose NBC news coverage and also plan to work with independent authors who use NBC’s resources.

It is possible to now see a greater polarisation of publishers with at one end the specialist and smaller publisher and self publisher and at the other large or divisions of large media entities. We already have the players such as News Corp, Bertlesmann, Pearson but are now likely to see others enter not necessarily with text content as their main asset. It will be interesting to see if the BBC soon rues the day it lost its publishing control.

Whatever, happens mixed digital media is here. The challenge is not burning your fingers in lavish digital utopias that don’t earn out and grappling with the issues of rights, acquisitions, licences, permissions and sales.

Monday, January 23, 2012

Last week we wrote about the logic of the appeal of the short story in this new digital world and yesterday we attended The Museum of London’s special 200th celebration of Charles Dickens.

What may you ask have has Dickens to do with today’s digital publishing world?The answer is simple and is significant if we are to learn from the past and keep our literary heritage alive.

Dickens was a master of the instalment.He not only wrote many works by the chapter, he also delivered them as ongoing works. He used the ‘penny press’ to presale the stories by instalment and in 1837 was selling some 50,000 copies of his Pickwick periodicals at a shilling a time. These contained one chapter sandwiched between pages of adverts. Many of these adverts had little to do with books or even the subject matter of the story. In fact the adverts demonstrate the diversity of the audience.

The journals appeared either weekly or monthly and given the number of chapters and volume of sales, plus the advertising revenues, should have earned him a good return. It is claimed that when Great Expectations was published in weekly instalment in 1861 it had weekly sales of some 100,000 units a week. Interestingly they didn’t diminish his book appeal but fuelled interest in the finally work.

We find ourselves again asking why we are not publishing digitally by instalment today? The Keita novels in Japan thrive through instalment and Stephen King and others have also ventured down this digital route, but why hasn’t a publisher grabbed this clear digital opportunity by the throat? Is it down to the way many write today? Has the publishing and editorial process got in the way of the instalment? Is it just too revolutionary?

Why are even short stories still seen as collections and packaged as such. Even worthy initiatives such as Quick Reads appear to be locked into what some may question as yesterday’s thinking and merely duplicating the physical offer digitally.What is also interesting is that Dickens lived through the literacy revolution where the masses were able to read and penny fiction was a way of feeding their new habit in a digestible form.

Dickens embraced the newThe transport and communications revolution of Dickens’ time was, on reflection, as great as that we have today with technology and communications changes. He travelled extensively, especially by the new railways, used the new telegraph and postal services. Between 1858 and 1870 he gave some 472 readings of his works in the UK and US. He even had special bound reading copies in larger font and was a consummate speaker. He was a writer, social observer, pamphleteer, speaker, columnist, playwright and publisher.

Dickens enhanced his worksIn Victorian times the novel was often enhanced by illustrations. The ‘Sketches by Boz’ was illustrated by George Cruikshank and as with many Dickens tales the reader was able to picture both in words and in imagery the story as it unfolded. Today we have often lost the imagery of yesterday. Does the new ebook now enable us to once again enhance and illustrate the book? There is now a new opportunity to bring back the imagery and even differentiate the different renditions.

Dickens wrote in the language of the peopleDickens was a master of not just description but narrative. He was a master of dialect and could write and express narrative to reflect a person’s origins, class and the times. He even travelled one day to Yarmouth and used the dialect he heard to paint the character he wanted. It is fascinating to hear how Dickens used the dropping of the ‘h’ , or how he could change ‘ing’ to be ‘in’ or even ‘ink’ to reflect the character. He would have been a nightmare to edit today!

But this understanding of the narrative and even the enthusiastic way Dickens would have read to his captive audiences may also be new enhanced book opportunities.

It is not hard to see the relevance of Dickens to today and why it is somewhat ironic that 2012 is the 200th celebration of his birth.

Saturday, January 21, 2012

So what was the biggest news story this week? The filing for Bankruptcy of that previously leading technology giant Kodak, the Presidential launch and hype of Apple’s grab for textbooks and to create an exclusive iWorld or the darkness created by the likes of Wikipedia and others and resultant climb-down of US legislators to their ill conceived SOPA and PIPA bills?

Kodak clearly teaches us that no one is immune to disruptive change and the emergence of digital technology and integrated video and photography in every smartphone simple by passed them. It is a very real lesson and one we should rank alongside many others who failed to adapt. In any value chain we all have to add value to survive.

The Apple launch will have significant repercussions far wider than the intended textbook market. Apple has not thrown a people into the pond but a whacking great bolder, that forces us to question much of what we do between author and reader. The one thing that is certain is that it will change not only what we do but how we do it and what we trade moving forward. Apple is not the winner merely the one to throw the first stone.

So what about the lights that went out over the Internet and the ensuing recreation of what, would have been bad law. This was a relatively quiet but significant revolution. Backed largely by big media and content producers such as the movie studios, record labels it is seen by them as their way to control and fight piracy and by many others as going too far the bills would have gone too far and with the capacity to created a nightmare.

The Stop Online Piracy Act (SOPA) was going to be bad law and along with its Senate cousin, the Protect IP Act,(PIPA) have galvanised protests across a very wide spectrum of companies and have been controversial from the beginning. Site such as Wikipedia and Reddit switched themselves of in protest. The object was to demonstrate what could easily happen under these ill conceived laws.

Under SOPA, a rights holder can take steps to shut that site off from search engines, ad networks, even Internet service providers and basically starve the offending site out of existence.

But critics see as being to easy to close down a supposedly offending site by just writing a strongly worded letter and would give legitimate sites a huge new set of legal obligations. Like a 21st century McCarthy witch hunt on the Internet.

On Wednesday U.S. lawmakers' websites were inundated with messages and Google delivered a 4-million-name petition against SOPA and even before the switch off, President Obama declared that he didn’t support SOPA. The silent majority stood up.

Is it the end, or will those experienced political wranglers and lobbyist divert their money to try and make some minor changes and push this bad law through?

Friday, January 20, 2012

Today we all wake up with an Apple hangover from yesterday’s iBooks Education announcement. We all will now face a bombardment of commentary on whether it is good, bad or ugly. Opinion will be divided. Technical detail on file constructs will loose all but the die hard techie. The commercial rights and wrongs of the restrictions Apple have built in to contracts, their pricing vision and much more will be heatedly debated. Finally, we will face the reality that we are now entering a significant escalation in the Gorilla wars between the big four technology media reading platforms that stretches far past learning and is fundamentally coming down to which player is smartest in capturing our attention and creating the groundswell to lock out the others. The war win not be won by the smartest technology, the most open technology but by the smartest marketing and PR programme.

Last night we participated in a debate on Litopia After Dark. It was good and at a high level. It was also strange in that we all appeared to be struggling to form an opinion either for or against and found ourselves asking for more clarification. This is not a case of glass half full, versus half empty, it is about getting common understanding on a wide range of social, commercial and technological issues as they relate to the offer presented and forming an opinion based on what we know and not on what we don’t know. We recommend you to listen to the Litopia Broadcast.

Today we can look at the high level issues and then drills down to further clarify points.

SocialIt is a given that learning can benefit enormously by universal access to technology to assist students of all ages to engage and develop. This is not just a US or even developed world issue and is truly global. However, at a time when spending everywhere is tight, we must ensure that choice prevails, in such a manner that it drives down cost and is inclusive and not divisive. Our thoughts are not about Apple versus Amazon but about Apple versus initiatives such as OLPC.

It is important that choice is available such that we avoid adding more fuel to the educational divide of those how can afford and those who have to learn without. Yes textbooks are expensive today, but replacing them with expensive technology that has an equally short shelf life, may not be the answer.

Finally, we must also consider who is the creator, who is the packager, who buys, who adapts and who users the content and context that supports learning. The value chain in one learning community or geography, doesn’t always prevail in another.

AuthoringWe have long recognised that we now live in a world where we no longer listen, read and watch, but were we increasingly write, produce and repurpose, or ‘mix’ our own media. The iBooksAuthor toolkit looks to fit this bill perfectly and acts as one would expect. It enables multi media to be packaged to explodes and enriches today’s flat content.

It is reportedly aimed at publishers but is it really aimed at them, or to undermine them?

Irrespective of the technical issues of the tool, we see a potential groundswell of self publishing authors taking to the tool to create their works and enrich them. Is this restricted to education – no. Is it restricted to educationalists even within the learning environment – no. Some would suggest that it has the power to help further democratise writing.

Why would large publishers then be standing next to Apple and supporting the launch? Some would suggest that these same publishers are backing not one but many horses and spreading their bets widely. Will they shift from their other investments in the likes of Coursesmart or fledglings such as Inkling?

The challenge that publishing and learning now has is identifying who the author in the ibookauthor world is. Is it the traditional author, the publisher, the education board, the institutional library, the teacher, the parents ot groups, or the student? Some will say all of the above.

Publishers today add more value than just producing a textbook and paying the author. They ensure quality, conformance, provide supplemental learning aides and content for the different stakeholders. The more complex the work, the more collaborative the workflow and the wider the participation of creating and producing it. Does ibookauthor support collaborative works, or is it simply focused on the single creator?

Will textbooks have to be created as is today and then enriched after the event, or enriched at concept and flowed into varies renditions?

If we move to a ‘cut and paste’ world of self authoring, not just of text but media, who will act as the gatekeeper, who will ensure rights are not infringed, who will ensure ‘fair use’ doesn’t become open piracy? It is one thing to democratise creativity it is another to try and control abuse. Yesterday we talked about the lack of a rights registry tomorrow we may now have to accept plagiarism as a given.

CommercialThe commercials disclosed at the event and on Apple would appear to be divisive. They have plucked a price point of $14.99 out of the sky and whether we all agree or disagree, that like mud will stick. Does this include or exclude any tax and Apple’s 30% commission? How is the pie divided up and what is the expected cut for all parties? Some will suggest that it is aimed at increasing volume sales, but others will suggest that the market is finite and in some subjects areas, very finite. Some suggest that it will lead to more smaller works. So instead of one textbook, you could now have four richer ones. Will buying more twxtbooks still add up to the same cost to the student as the one textbook today and so defeat the argument of affordability.

There are many potential issues for ‘authors’ and publishers to consider in the terms published. Obviously these may not be applied to those Apple want on board, but we expect that there will be much written on this subject and it impact on whether the platform is open or closed commercially.

TechnologySome would talk about technology first, but It is interesting and fitting that we find ourselves bringing it up last.

Already the debates are raging across the internet as to the level of openness Apple has adopted with their new tool. Yes it is compliant with ePUB3, but with extensions and those would appear to be more in the CSS style sheet end and could prove a challenge to unlock for many. It make it a close format, merely hiding behind an open standard.

It would also appear that ibookauthor is free, open, but only available in Appleworld and on Apple devices. Good for Apple sales and domination, not so good for many others outside this community with sunk investment.

What we don’t understand today is how these new textbooks will work with the LMS environment and whether they will sit outside, inside or create new ones of their own called iBookstore?

For just one take on some technical aspects read this early paper by Baldur Bjarnason. There will be many more over the next few days.

Some have questioned the size of the files and the devices ability to accommodate them but these issues can be overcome. We await the next Apple launch.

There are many who recognise that all technology doors can be open and issues overcome. To many self publishers and small publishers, app developers etc these lock-ins may not matter as much as getting their creation published and in the one store.

We were asked last night what we thought the impact would be 5 years out.

We think:

it will change self publishing of rich material, be it reference, learning, information etc.

the take up in education will be slower that Apple would like as the beast is cumbersome and change is not overnight.

Google, Amazon, Adobe, Facebook all have to respond and these will heavily impact the coming platform wars and not just in learning

Governments and those holding the purse strings will decide some battles and with the budgets for content and technology starting to blurr in the US, this may be the start of a huge platform war

Today the dust is far from settled and some would suggest that anyone who is today either 100% for or against the initiative is not going to change their opinion whatever comes to light. The presentation and hype certainly drives a stake in the ground and made messages which are hard to disagree with, but it is not those but the Apple execution that we must focus on and decide if it works as delivered, needs to be adapted or doesn’t fly.

Wednesday, January 18, 2012

We now live in a sound bite word where the channel hopper often rules and where our time is often torn between many competing distractions. It is only fitting therefore that we are now starting to question and revisit the length of the story and recognise that it is just as rewarding to engage a reader on short and digestible read as a long one.

We have long argued that the digital era should herald a renaissance of the short story. As digital explodes the physical book spine, it starts to re write the economics and the need for 256 pages. No longer is it about tens of thousands of words but more about compact stories, or developing stories by the chapter.

My mother-in-law and many of her contemporaries broke into writing via short stories, which were much in demand across many magazines at the time. My Father-in-law like many started as a journalist and developed the skill of reworking, cutting back and sticking to the storyline.

Digital has started to now accommodate the short story and some such as Salt and Penguin has embraced the opportunity. The BBC has a National Short Story Award and the Quick Reads literary charity is now 5 years old and has distributed over 3.5 million ‘Quick Reads’ written by bestselling writers and celebrities aimed at engaging more people in reading.

This weekend the Telegraph dived in with a competition not based just on digital but recognising the potential to reintroduce this concise literary form that has inspired so many in the past. The British library have also launched a online service to enable everyone to enjoy the likes of Somerset Maughan, Kingsley Amis, Edna o’Brien and William Trevor reading their own works.

All these initiatives start to create a new form. Some will view them as singles that are then wrapped into a collection, others as stand alone stories that can be promoted bought and read as such and others as instalments to a greater living story. Poetry also starts to also have new opportunities to engage a wiser audience. Even those textbooks may be rented or sold by the chapter. Irrespective, the short is coming back and will give author a new opportunity to make that connection with the reader.

Friday, January 13, 2012

Before his death Steve Jobs had already targeted textbooks as the next opportunity His idea was to hire the best textbook writers to new create digital versions that were complimentary and exploited the iPad. Importantly he wanted to make them free so they would obviate the US state adoption and certification process, which he thought was “corrupt.” In chapter 38 of his biography he says “ if we can make the textbooks free, and they come with the iPad, then they don’t have to be certified. The crappy economy at the state level will last for a decade, and we can give them an opportunity to circumvent that whole process and save money.”

Apple have now announced a special event at the Guggenheim Museum in New York City on Jan. 19. It is widely reported that Apple will announce partnerships with textbook publishers aimed at positioning Apple at the heart of the multi billion dollar market. Apple will launch their new digital textbook business. We don’t know the plan, but expect that in a market dominated by a few large publishers such as Pearson Education, Cengage Learning, McGraw-Hill Education, John Wiley & Sons and Macmillan that some will be looking for that Apple magic to rub off on just on their sales but their share values.

A report, "Simba Information's 2011 National Textbook Adoption Scorecard and 2012 Outlook," claims that almost all adoption states now are either promoting or permitting the inclusion of digital textbooks and other digital resources and importantly this includes hardware. It states that "Texas jettisoned the term textbook and replaced it with instructional materials, expanding the adoption process…Recent changes have also allowed districts to acquire hardware using the adoption funds." With respect to Florida it reports that the state’s Board of Education has overhauled its instructional materials adoption process and placed a greater emphasis on the approval and spending for digital materials, By the 2015-2016 school year…districts are required to spend at least 50% of their funding on digital materials."

If Apple were to secure a significant foothold in the market and deliver a seed change in how textbooks get adopted and bought they could well see significant revenues both in devices and in collecting 30% commission on each textbook sale.

So apart from the industry stalwarts such as Follett who are some of the leading digital textbook players today and can they adapt top any disruptive change?

CourseSmart.The company was founded by a consortium of higher education textbook publishers to both offer digital inspection copies and full titles. It currently has iOS app for reading textbooks and with the backing of the major publishers is a force in the market. It is questionable whether this is used as the content repository and vehicle and so bolster its position further, or is sacrificed by its publishers and will now find itself competing with Apple.

Kno.Kno has moved from being a device company to a platform and software one and is reported to have some 150,000 textbooks from 45 publishers. Kno textbooks are already viewable on Apple devices and the company was the top-downloaded educational app in Apple’s App Store at the end of last year .

Inkling.Inkling has an iPad textbook app), which combines reading school texts with social and interactive ways to study with others with links to external and authoritative sources. McGraw-Hill and Pearson have both invested in Inkling.

Vitalsource.Is part of Ingram Content Group also has its own app, with 60,000 digital textbook titles available for download to any iOS device. Vitalsource now has two million students using its platform worldwide and providing feedback to tell a publisher, “Nobody is reading Chapter 8,” as well as enabling enhanced multimedia applications.

Then there is the wonderfully branded site http://www.appletextbooks.com/ . A few challenges here we think.

The iBookstore hasn’t lived up to the expectations that many had and the Apple agency model is subject to a number of fair trading reviews. Will textbooks fair differently and make the difference and how will impact others already trading digital content? We then have the Appleworld rule against running apps on iOS devices that direct the user away from Apple's ecosystem to buy competing products without using Apple e-commerce engines to handle the transaction. Apple has imposed a 30% tool both and made it harder to buy from the likes of Amazon, Barnes and Noble and others. However as demonstrated by Amazon’s latest ipad optimized website its relatively easy to provide a clean and touch-friendly for iPad-based browsing experience for readers without a 30% toll booth. With increasingly powerful Web-based solutions using technologies like HTML5, Apple won't be able to keep its ecosystem as closed as it might like.

Amazon’s touch-optimized Kindle Store for iPad allows readers to purchase or read Kindle e-book selections via Safari. The HTML5-based reading app is available via amazon.com/cloudreader and provides access to e-books through the browser, offline and online, with no downloading or installation required. Cloud Reader automatically syncs with other Kindle apps.

The AAP (American Association of Publishers) estimates that the college textbooks industry was worth $4.58 billion last year. Student Monitor, a private New Jersey student market research company claims that autumn etextbook acquisitions where up over 100% on spring and accounted for some 5% of sales. Simba Information, estimates that etextbooks will rise by 44.3% and generate $267.3 million US sales this year and they also estimate that, sales generated from state textbook adoption programs in Texas totaled $660 million in 2011.

However, we have to be also mindful of Job’s intent was not just to shake up the ‘corrupt’ textbook supply chain but to make them affordable if not free! Whatever the outcome Apple appears determined to shake the tree and collect the fruit.

Tuesday, January 10, 2012

One of the drawbacks with ebooks is that there is no second hand market for them. Unlike physical books you can’t sell a book once you have read it. You can’t even put it on your bookshelf. It is doomed to sit often forgotten on some virtual bookshelf.

The lack of ‘first sale doctrine’ on ebooks is a big opportunity lost today as we find ourselves tied up in DRM knots and fear of the digital unknown. Too much of what we do is negative and restrictive and denies freedoms, rights and norms taken as a given within the physical world. Denying established social practice just helps fuel further consumer piracy.

Music is probably the last sector media should look at for digital guidance. Last week EMI filed two lawsuits against different online music services, Grooveshark and ReDigi for breach of contract and copyright infringement.

The first case against Grooveshark is understandable in that it is claimed that the digital music service has paid no royalties since entering a licensing agreement to stream music nearly three years ago. That it has taken three years to issue a lawsuit is somewhat amazing and EMI’s filing comes after three other major record companies; Universal Music Group, Sony Corp and Warner Music Group, all filing accusing Grooveshark of pirating thousands of songs.

Founded in 2006, Grooveshark claims 35 million users and has major adverting support contracts. It allows users to upload songs to their servers, which it then lets other users stream for free. A virtual ‘swopshop’. The music industry is starting to accept services like Spotify and Rhapsody that stream music by subscription, but Grooveshark is again different and operates heavily under the protection of the Digital Millennium Copyright Act.

Founded only last year ReDigi is different again and operates under the “first sale doctrine” legal concept, that allows users who buy a copyrighted item like a book or CD the right to sell it or give it away. ReDigi operates a ‘used music store’ where users upload unwanted songs and buy others at a discount. ReDigi claim that they can verify individual MP3 files were legally purchased and not ripped or downloaded from a file-sharing network. Interestingly the sellers must also install a ReDigi program on their computer that removes any copies of a song from the seller’s computer.

The case pivots on the claim ReDigi is infringing copyright in making copies of digital files as part of the process of uploading songs from a seller’s computer and transferring them to a buyer’s. EMI claim that, unlike selling a used CD, a used MP3 is theoretically the same as a new one and hence the infringement. ReDigi counters saying it is merely acting as a responsible marketplace. Again EMI is not alone and the RIAA (Recording Industry Association of America) has also sent ReDigi a cease-and-desist letter.

So we return to the question of opportunity versus restriction, or a glass half empty versus a glass half full. Digital files have been made different not by technology, but by unimaginative thinking, restrictive DRM and bad law that is no longer relevant to the times. We must all realise that just as like having different tax rules for the same product, having different consumer rights will just drive more honest consumers to cut corners and disrespect copyright. The publishers may protect today’s revenues, but in doing so may end up losing tomorrow’s and their customers.

Publisher be they music, games, ebooks all have to realise that the right to resell is a given and finding a way to allow that is a must. We already have digital rental and loans and restricting or denying resell is just plain lunacy. The resell markets could in fact blooster the price of the original sale and start to create value added ownership. It could even offer the independent bookstore a digital lifeline. The ebooks and publishing market is a very fragmented and getting consensus of vision let alone action is often a challenge in itself.

The way we all consume and pay for media is changing radically and moving from, pay to own, to subscribe for on demand. This is no longer about music, film, games, TV,information and books , but about all digital media and how we find it, access it and pay for it.

The film on demand wars just got a lot more interesting in the UK with the news that Movie and TV streaming service Netflix has launched in the UK and Ireland. It is claimed that Netflix has been the single biggest driver of internet traffic in the US and has over 20 million online subscribers in 47 countries.

Online rival and Amazon owned Lovefilm, recently surpassed two million subscribers and both it and Netflix now line up against Sky Movies,Sky Atlantic, Virgin Media, YouTube and retailers such as Tesco’s Blinkbix for the online market.

Netflix has only launched its online service in the UK and in doing so has pledged to break BSkyB's stranglehold on the movie market. The service will allow users to stream film and TV content on devices including tablets, smartphones, games consoles and internet TVs and all priced at just £5.99 a month. Not to be undone Amazon's LoveFilm, has announced a new "streaming-only" tariff at £4.99 a month. Netflix hopes that its personalisation technology and an integration with Facebook, which allows people to share what they are watching with friends on the social network, will also provide it with competitive edge.

Netflix has also announced a number of new TV and film deals with partners that include Channel 4, Disney, ITV, Sony, 20th Century Fox and All3Media. These deals are mainly for the second rights window as opposed to BSkyB’s which has prime rights deals with the six major Hollywood studios which enable it to air films in the first pay window. When Netflix launched in Canada the company had no "pay one" deals.

Netflix has also announce deals with the likes of the BBC, Miramax, Lionsgate, MGM which will give it access to titles such as Pulp Fiction, Kick-Ass, Top Gear and Doctor Who. Lovefilm has agreements with partners including ITV, BBC, Warner Bros, Entertainment One, Sony and Studio Canal for titles that include the Twilight Saga, Tinker, Tailor, Soldier, Spy and The Social Network.

So the UK now has three determined online streaming service providers who are not only going to aggressively compete on price but also on content. We see the growth and demand for Spotifty's music on demand, Wii's expansion to media console and recognise that as media continues to converge, platforms become important and usage migrates to on-demand we ask why many many still see books as different?

Monday, January 09, 2012

Apart from basic Amazon Kindles what other eink devices are selling today. It could be said that even the Kindle could soon be on Fire. The fact is that the ‘loookie likie’ devices that once littered the market are today being usurped by AMOLED smartphones and tablets. The best measure for this decline came today as E Ink Holdings Inc. shares slumped some 6.9% (the lowest close since July 1, 2009) on the news of the company’s December sales which had slid 84% from a year earlier!

Fourth quarter sales were only down 4% from the third quarter and overall annual sales were up 53% However, E Ink alarmingly reported that its December consolidated sales were down 55% from November and also down 57% from a year earlier...

Investors may see this as a temporary sales issue, but some will see eink has had its day as we know it today and is unlikely to bounce back and that far from a seasonal dip it could be a sudden decline. We have seen yet another supplier BeBook bite the dust and its hard to see any real action other than basic Kindles..

This time of year is not about January sales, but CES in Vagas and the new electronic gadgets and devices on show or rumours afoot. This year may not be so exciting as previously, there are some very interesting developments.

Ultrabooks

There will be more tablets this year, but the question remains as to whether they are seriously going to compete with the iPad at the high end and the Kindle at the low end, or end up as RIM, holding the baby? Are the manufacturers going to avoid the tablet and concentrate on the ultrabooks? The ultra thin 'weightless' models that are now starting to flood into the market to compete with the Macbook Air. Its just as if everyone wants to be Kate Moss! Personally we have been eying the Asus ultra model for a couple of months. With laptops now weighing in at just over 1Kg why do we need a tablet? These models are not new, but the $100 per device incentive from Intel to manufactures to build them is. As a result there are expected to be about 50 ultrabook designs on show, costing around $1,000 and as we all need to upgrade some time, why not with a device that is as light as a feather..

OLPC Tablet

We have always love the One Laptop Per Child project and it is now set to unveil its long-awaited tablet for $100. The tablet will feature an 8-inch 1024x768 screen, a Marvell Armada PXA618 chip and 512MB of RAM, running either Linux Sugar or Android OS. It will be able to be powered by hand-cranking and even has a solar panel optional extra! We love the housing and design and it shows that a $100 tablet is now a reality.

Rumours are rife again on Google introducing a low end tablet early this year. This would probably follow their tie ups with Motorola and partnership with Samsung on Nexus. However do they have the media to make it attractive or will it remain an also ran like many other tablets?

Wii U Media Console?

There are the rumours that the Wii U will support a touch screen in the next generation console. The feature will have Ereader features which would allow users to download not only books, but newspapers, magazines, comics but much more. The touch screen will be used in a typical fashion to scroll of flip pages and would make the Wii U a more services orientated console and widen its appeal to be more of a entertainment and media than just a gaming device. There are even reports that Nintendo is secretly building its own Apple-like app store for the upcoming Wii U console.

Reading on Kindle via solar power?

Finally, Gizamo reports on a new leather Kindle case with an integrated reserve battery that can store solar energy to power a built-in pop-up LED reading lamp for up to 50 hours.

Friday, January 06, 2012

Last year the US market lost Borders and book chains globally started to look increasingly as vulnerable. Today’s news on the deliberations, speculation and announcements at Barnes and Noble are the latest shockwaves to reverberate across the publishing world. Whatever they do, or don’t do, it is apparent that everything is up for grabs, with reports of the sale of Sterling Publishing and the splitting of the Nook ebusiness from the bricks and mortar business. As its shares tumbled on the news to what looks, from the outside to be a PR and communications ‘challenge ‘ it leaves many asking just what the strategy and the desired outcome is.

Barnes and Noble have stated that the two sides to their retail business have very different levels of maturity and investment. What is alarming is that they make the public announcements and then say that there is no certainty that the review will result in a separation but that they do not rule out a potential sale of the ereader business. The obvious lack of strategy will not assure investors and without the Nook ebusiness what is left? The bricks and motor business is solid, but with no US chain competition, B&N would appear to be not taking up the slack Borders left behind.

The Nook sale could generate substantial cash for shareholders but does it include BarnesandNoble.com or is it just the ebook business? Barnes and Noble’s ebook business is where it is today on its brand. We think its time that Barnes and Noble realise that the brand is Barnes and Noble not the Nook. Without that affiliation would consumers still buy Nook? Would it have sold even a fraction of its sales without the Barnes and Noble brand? It is different to Kobo and Indigo, where KOBO’s brand was built separately from the start and also internationally many consumers have not even heard of Indigo. Is Nook actually strong enoughto survive alone and even if Waterstones were to adopt it would it be just another case of dejavu?

Even more surprising is the news that Barnes and Noble intent to get out of publishing and sell off Sterling Publishing. The shareholders may be rubbing their hands at the thought of cash but is Sterling in fact the digital family silver? In a world where content is the key, why sell off a viable content business that feeds the digital engine. Barnes and Noble have long bought into print runs, had their own imprints and Sterling’s wide range of content is perfect for digital exploitation. At a time when digital content is about to explode and Amazon is increasing its publishing activities, it wise to dispose of this asset for a few pieces of silver? There is also the question of whether the potential sale of Nook and Sterling will include Pubit , or exclude the self publishing ebook imprint?

We can see that B&N is not going to win the battle against Amazon’s Kindle platform. Their pockets are not deep enough, neither are the strategically positioned even within the US, let alone outside it, to do so. Can they be happy being the number two in the US or even lower and nowhere outside the US? Will Apple or Google inflict more damage to their market share? As Apple prepares to launch its own self publishing offer and go textebook and Google prepares a tablet, where would Nook stand? Like Amazon, B&N understand publishing and bookselling, but unlike Amazon they are carrying too much baggage, have less understanding shareholders and have greater financial exposure.

Wednesday, January 04, 2012

According to industry bodies, governments and the press, digital piracy is reaching epidemic proportions and swift and focused action is needed to save the media industry. We are now regularly informed of the growth of piracy, the estimated number of illegal transgressions, amount of revenue stolen and even the numbers of jobs lost to piracy. Piracy is not restricted to any one medium and impacts the; software, games, film, music and now book industries.

Content piracy is not new and many of us have committed piracy, or know someone who has done it, either wittingly or unwittingly. We must face the reality that it will never be totally eradicated and there are degrees of piracy.

We now have legislation being rushed through different bodies that is aimed at shutting down sites and fining or black listing users. We have all read of the court prosecutions against individuals bought by bodies such as the RIAA. However if we step back, we could easily conclude that the threat of the stick, appears to be having little, if no effect and that piracy would appear to be on the rise in all sectors.

The questions we pose are not aimed at solving piracy, but at trying to understand what drives it and in doing so, look at alternative ways to contain, or reduce it. In many ways, it is a social problem similar to others such as; drugs, gambling, drinking and prostitution. It is important that we do not set our sights too high and by doing so, alienate those we wish to influence and that we are realistic in what we wish to achieve.

What are some of the root causes which are feeding the current digital piracy habit?

Free

Napster didn’t create the ‘digital free’ perception, but helped raise its profile to the masses. As Napster and others changed to pay models, they failed to migrate their bases and the ‘free’ music demand they created remained. Is the problem really ‘free’, or is it the ability to share and network with friends? We obviously will face the challenge of first defining a ‘friend’.

We believe that people are willing to pay and also recognise the need to support creative talent. However we also recognise that the hard core of people who will always demand ‘free’ are not going away and maybe are impossible to coral.

Fair Use

The right to fair use has always been prevalent and is very relevant in academia and libraries. Digital potentially lifts the fair use lid and can create confusion in the eyes of the user. Creative commons licensing is a positive way forward and is starting to address this. It adopts a mature approach to copyright licensing and one which accepts the fair use doctrine. However, works that are not licensed under creative commons can fuel confusion and lead to a piracy approach to all works. Interestingly, our copyright laws were built in an era where we listened, watched and read media, but today they must encompass and era where many now also create media.

Music and film industries have had to grapple with the demand for sampling and our permission rights now need to reflect this. The challenge remains a rights industry without a rights registry and frustration can often lead to rights shortcuts and piracy.

Price

Price is always the sore point. Academic, text, professional, reference and trade books all have pricing challenges. It is easy to put a recommended retail price on a title, it is a lot harder to convey its value and sell it in a world that is now discount crazy, very price sensitive and where a price comparison is only a click away. We would suggest that the heavy discounting of physical books has had a significant devaluation impact on the perceived value of ebooks. It is also crazy to try to enforce a retail price maintenance ‘agency’ regime on ebooks, whilst allowing a price discounting free for all on physical books. Think of the consumer perception of such open hypocrisy.

Tax

We all have an aversion to paying taxes, especially taxes we don’t agree with. Governments openly reduce the tax on pbooks to promote reading whilst taxing ebooks to raise revenue. Are Governments and tax authorities actually fuelling piracy with taxes that are clearly inconsistent between the physical and digital rendition of the same work? Taxes have to be raised and someone has to pay, but no one likes to be ripped off. Who can justify a 20% tax difference? This taxing hypocrisy is not unique to the UK and is prevalent across many countries. Governments have to realise that the economy is now global, digital transparency is real and clear double standards will drive many to piracy. The media associations should be educating the government to think about its negative actions on tax.

Ownership

We all know that a digital file can be spliced and diced far easier that its physical cousin. One click and the font and its size can change. Another click and we have text to speech. We can annotate alongside the text, create bookmarks and of course copy and paste and much more. Today we still put ebooks into a DRM straightjacket ‘for the good of copyright’. We do not allow ‘the first sale doctrine’, often make it impossible to share books with friends and even limit the number of devices we can transfer the file to. The industry has failed to grasp even half way measures, such as social DRM (watermarking) and has maintained a hard line DRM approach. It reminds one of the early music days before the operators realised that MP3 wasn’t as much a threat as DRM which overly restricted user’s rights. It is questionable whether there would be any viable download market today if the likes of Apple had not abandoned their rigid DRM and embraced MP3.

Users want to ‘own’ their files and even sell them. If this is not recognised, then it either puts pressure on the price paid, or generates piracy. We must look at the ‘on demand’ and cloud based licence models, such as used by Spotify and Netflix.

However, is the industry ready or even willing to entertain such a radical shift when it can’t appear to even sort out its digital lending relationship with libraries?

The issues that drive piracy are not simple and are more about social economics. Cracking down on the dealers of piracy is understandable, but it is not addressing the demand and the actions needed to change social behaviour. When we throw are arms up and complain about the level of apparent piracy and its estimated loss of revenue, we should perhaps ask ourselves, what we would accept as acceptable and work towards monitoring and maintaining this. A zero tolerance approach to piracy may well result in more not less.

About Me

Before entering publishing I worked for many years as a Senior Executive in blue chip organisations in the retail, oil and automotive sectors. My publishing induction was initially as Director of Strategic Development at VISTA. There I was responsible for, and a contributor to, their highly acclaimed ‘Publishing in the 21st Century’ research series, the primary creator behind publishing services PubEasy and ‘batch.co.uk’, the initiator of the development of new Front Office systems to support publishers. In 2006 I joined Value Chain International(VCIL) initially as VP Marketing, Media and Publishing before becoming their President in 2009. In July 2011 the company's operations were acquired by Syncordia. I hold two non executive positions with publishing industry players Bibliophile Ltd and Haven Group and currently setting up Read Petite a service focused on providing digital short form material online via subscription.
Email mdaniels@opus57.co.uk